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Page 1: Decoding CDR Reports and Correcting Data - … · Decoding CDR Reports and Correcting Data Why Review Your CDR Data –A high CDR could result in ... •Decode the Loan Record Detail

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Decoding CDR Reports and

Correcting Data

Why Review Your CDR Data

– A high CDR could result in

• Adverse publicity

• Loss of Title IV eligibility

• Loss of access to private loan funds

• Extra work due to loss of benefits or added

sanctions

Administrative capability

Why Review Your CDR Data

– Capturing the right data, accurate data, and

timely data is critical for making good policy

and accurate decisions

Administrative capability

Better-quality decision-making

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Why Review Your CDR Data

– When borrowers default

• They pay more in interest and collections fees

• The government can seize wages, tax refunds,

and Social Security and disability benefits

Administrative capability

Better service to students

Better-quality decision-making

Objectives

• Understand the Cohort Default

Rate (CDR) cycle

• Decode the Loan Record Detail Report

• Learn how to collect, compare, and

correct data

• Know common appeal errors to avoid

Understanding the Cohort

Default Rate Cycle

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What Is a Cohort Default Rate?

The Numerator is the

number of Stafford loan

borrowers from the

denominator who default

within a cohort period

The Denominator is the

number of Stafford loan

borrowers who enter

repayment within a

cohort period

= Did not default

in 2011-2013

= Defaulted

in 2011

= Defaulted

in 2012

= Defaulted

in 2013

All borrowers entered

repayment in 2011

What Is a Cohort Default Period?

Borrowers who entered

repayment between

10/01/2010 and

9/30/2011

Borrowers who entered

repayment between

10/01/2010 and

9/30/2011

Borrowers who entered

repayment between

10/01/2010 and 9/30/2011

and who defaulted between

10/01/2010 and 9/30/2012

2-year CDR Example FY2011

Borrowers who entered

repayment between

10/01/2010 and 9/30/2011

and who defaulted between

10/01/2010 and 9/30/2013

3-year CDR Example FY2011

What Is a Cohort Default Rate

Cycle?

• The Department sends draft and official cohort

default rates to all schools that

– Are eligible to participate in any of the Title IV

programs

– Have had a borrower in repayment in the current or

any of the past cohort default rate periods

February August

Draft default rates released

to schools only

Official rates released to

schools and the general public

September January

Draft Rate Cycle Official Rate Cycle

Source: CDR Quick Reference Guide

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What Is a Cohort Default Rate

Cycle?

• The official cohort default rates are available to

the public through a searchable database at:

– ed.gov/FSA/defaultmanagement/cdr.html

Source: CDR Quick Reference Guide

February August

Draft default rates released

to schools only

Official rates released to

schools and the general public

September January

Draft Rate Cycle Official Rate Cycle

No Sanctions or Benefits

Associated with Draft CDR

• Keep in mind

– Schools that fail to challenge the accuracy of

draft cohort default rate data through an

incorrect data challenge may not contest the

accuracy of the data used in the official rate

Fiscal

Year

(FY)

Denominator

# in

Repayment

Numerator

# in Default

Draft CDR

Publication

Date

Official CDR

Publication

Date

Rate Used for

Sanctions

2010 10/01/09 – 09/30/10 3-yr: 10/01/09 – 09/30/12 3-yr: Feb 2013 3-yr: Sept 2013 N/A

2011 10/01/10 – 09/30/11 2-yr: 10/01/10 – 09/30/12

3-yr: 10/01/10 – 09/30/13

2-yr: Feb 2013

3-yr: Feb 2014

2-yr: Sept 2013

3-yr: Sept 2014

2-yr rate (25%)

3-yr rate (30%)

2012 10/01/11 – 09/30/12 3-yr: 10/01/11 – 09/30/14 3-yr: Feb 2015 3-yr: Sept 2015 3-yr rate (30%)

Publication of CDRs

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How Are Schools Notified?

• CDR notification packages

– Sent electronically to all domestic schools

(eCDR)

• Using Student Aid Internet Gateway (SAIG)

• Allowed five business days to report problems

• Timelines for submitting challenges, adjustments,

and appeals begin six days following announced

transmission date, as posted on IFAP (ifap.ed.gov)

What is Included in the eCDR?

• CDR package includes

– Cover letter

– Two Loan Record Detail Reports (LRDR)

• Reader-friendly

• Extract-type

• CDR package includes

– SHDRLROP

– SHCDRROP

– SHCDREOP

– Cover letter

– Loan Record Detail

Reports (LRDR) • Reader-friendly

• Extract-type

Decoding the Loan Record

Detail Report

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Loan Record Detail Report (LRDR)

• Contains borrower information for Stafford

loans that were used to calculate a

school’s draft or official cohort default rate

– Includes borrower’s

• Name, Social Security number

• Date borrower entered repayment

• Date of default (if applicable)

• Loan type

– Borrowers with multiple loans will be

counted only once

Review LRDR

• Check for accuracy

• Compare to school records

– Repayment Date

– Default Status

– Cancellations/Refunds

What is Included in the eCDR?

• Beginning with the

FY 2009 cohort all

schools MUST use

eCDR Appeals to

prepare and submit

challenges or

adjustments

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Reader-Friendly LRDR

Loan Record Detail Report –

Data Manager

• Three-digit code used to identify entity

reporting the information

Guaranty Agency Department of Education

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Loan Record Detail Report –

Repayment Date

• Indicates when the borrower began repayment

• Determines if the loan is included in

the denominator

Loan Record Detail Report –

Default Date

• Indicates the date – A Direct Loan is considered in default based on its past due

status

OR

– Guarantee agency paid a default claim to a lender for a FFELP

Loan

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Loan Record Detail Report –

CDR Usage

• Indicates how the loan is included in the calculation

– “D” Denominator only

– “B” Both Numerator and Denominator

– “N” Not Used

– “E” Eligible, but not counted

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Important Codes to Know

Source: CDR Guide, page 2.3-7

Important Codes to Know

Source: CDR Guide, page 2.3-8

Collecting and Comparing

Data

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Collecting the Data

• Determine data that needs to be captured

– Last date of attendance (LDA)

– Less than half-time date (LTH)

– Withdrawal date (WD)

– Date entered repayment (DER)

– Claim paid date/default date (CPD/DD)

• Use a spreadsheet or database to collect

this data

– Implement this process early

Collecting the Data

– Internal resources

available on-campus

– External resources

• NSLDS

• Servicer reports

• Guaranty agencies

Determine where

to find data

Possible Errors on LRDR

• LRDR incorrectly:

– Reports a data element and the data element

should be changed

– Includes a borrower whose repayment date

does not fall within the cohort fiscal year and

the borrower should be removed from the

cohort rate calculation

– Excludes a borrower who entered repayment

within the cohort and the borrower should be

added to the cohort rate calculation

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Should the Loan be Included in

FY09 3-year CDR?

Darin

• Graduated from your school 11/4/2008

• NSLDS reveals Darin transferred to another school on 2/4/2009

LDA

11/4/2008

Add 6 months,

1 day

5/5/2009

Date entered repayment

Actual DER

5/13/2010

Default date

5/8/2011

Should the Loan be Included in

FY09 3-year CDR? No

Y Defaulted between 10/1/2008 – 9/31/2011 • Defaulted 5/8/2011

N FY2009 (10/1/2008 – 09/31/2009)

• Date Darin entered repayment 5/13/2010

If date of repayment is delayed by re-enrolling in school prior to the end of grace, inclusion in a CDR calculation is also delayed

Darin

Should the Loan be Included in

FY09 3-year CDR?

• Left your school 11/4/2008

• Transferred to another school 1/12/2010

• Loans are deferred on 1/12/2010

LDA

11/4/2008

Add 6 months,

1 day

5/5/2009

Date entered repayment

05/05/2009

(Loan deferred 1/12/2010)

Default date

NA

Kara

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Should the Loan be Included in

FY09 3-year CDR? Yes

Deferments or forbearances do not alter the date the borrower entered repayment

N Defaulted between 10/1/2008 - 9/31/2011 • No default

Y FY2009 (10/1/2008 – 09/31/2009)

• Date Kara entered repayment 05/05/2009

Kara

Should the Loan be Included in

FY09 3-year CDR?

• Withdrew from your school 6/1/2008

• Defaulted on loans 05/27/2010

• Consolidated three loans 12/4/2010 in order to regain Title IV eligibility

LDA

6/1/2008

Add 6 months,

1 day

12/2/2008

Date entered repayment

12/2/2008

Default date

5/27/2010

Kyle

Should the Loan be Included in

FY09 3-year CDR? Yes

Y Defaulted between 10/1/2008 – 9/31/2011

• Kyle defaulted 5/27/2010

Y FY2009 (10/1/2008 – 09/31/2009)

• Date Kyle entered repayment 12/02/2008

The date underlying loans entered repayment is the date used in the cohort default rate calculation

Kyle

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Should the Loan be Included in

FY09 3-year CDR?

• Graduated from your school 6/1/2008

• Paid loan in full on 7/1/2008

LDA

6/1/2008

Add 6 months,

1 day

12/2/2008

Date entered repayment

Loan paid in full 7/1/2008

Default date

NA

Bethany

Should the Loan be Included in

FY09 3-year CDR? No

The paid-in-full date becomes the new repayment date

Same is true for loans discharged due to death, bankruptcy, disability

Defaulted between 10/1/2008 – 9/31/2011

• No default

FY2009 (10/1/2008 – 09/31/2009)

• Date Bethany paid in full 07/01/2008

N

N

Bethany

Correcting Data

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Challenges of Draft CDR

– Used to correct errors on the draft CDR

– Submitted by school to guarantors (FFEL)

and/or DL servicers via eCDR Appeals within

45 days of timeframe begin date

• Relevant information for each borrower challenged

• Supporting documentation for each borrower

challenged

• CEO Certification Letter

34 CFR 668.185(b)

34 CFR 668.204(b)

Incorrect Data Challenge (IDC)

Challenges of Draft CDR

– Only available if a school is potentially subject to a loss of eligibility (or provisional certification) based on draft rates

– School must send completed PRI Challenge to the U.S. Department of Education within 45 days of timeframe begin date

• PRI Challenge Spreadsheet (CDR Guide page 4.2 – 8)

• Letter

Participation Rate Index Challenge (PRI)

34 CFR 668.185(c)

Adjustments of Official CDR

– Ensures that a school’s official cohort default

rate calculation reflects changes that were

correctly agreed to as a result of an incorrect

data challenge

– School must submit its UDA to the

Department within 30 calendar days of

timeframe begin date via eCDR Appeals

system

34 CFR 668.190

34 CFR 668.209

Uncorrected Data Adjustment (UDA)

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Adjustments of Official CDR

– Allows a school to challenge the accuracy of “new

data” included in most recent official CDR

• Compare LRDR of draft CDR to LRDR of official CDR to

determine if new data is reported correctly

– School must submit its NDA to Data Manager via

eCDR Appeals within 15 days of timeframe begin

date

• Relevant information for each borrower challenged

• Supporting documentation each borrower challenged

• CEO Certification Letter

New Data Adjustment (NDA)

34 CFR 668.191

34 CFR 668.210

Appeals of Official CDR

– Alleges a school’s official cohort default

rate includes defaulted loans that are

considered improperly serviced for cohort

default rate purposes

– Example

• Borrower never made a loan payment and school

can document that lender/servicer failed to

complete due diligence

Loan Servicing Appeal (LS)

34 CFR 668.193

34 CFR 668.212

Appeals of Official CDR

– School must send request for loan

servicing records to Data Manager and

to the Department within 15 days of

timeframe begin date

Loan Servicing Appeal (LS)

34 CFR 668.193

34 CFR 668.212

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Appeals of Official CDR

– Data Manager notifies school and the

Department within 20 days of receipt

of request

• Fees for providing records

• List of representative sample

• Description of how sample was chosen

– School must pay the fee, if charged within

15 days of data manager notification

Loan Servicing Appeal (LS)

34 CFR 668.193

34 CFR 668.212

Appeals of Official CDR

– Available if the school is subject to a loss of

eligibility (or provisional certification) based on

official rates; or

– If the school previously challenged the

accuracy of data as part of its Incorrect Data

Challenge, or

– If a review of loan record detail reports for

draft and official rates show new data

Erroneous Data Appeal (ER)

34 CFR 668.192

34 CFR 668.211

Appeals of Official CDR

– School must send the Erroneous Data Appeal

allegations to Data Manager within 15 days of

timeframe begin date

• Erroneous Data Appeal spreadsheet

• Relevant pages of Loan Record Detail Report

• Supporting documentation

• Letter

Erroneous Data Appeal (ER)

34 CFR 668.192

34 CFR 668.211

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Appeals of Official CDR

– Available based on a loss of eligibility or notice of second successive official rate potentially subjecting school to provisional certification

– School must submit an independent auditor’s written opinion to the Department within 30 days of timeframe begin date

• Spreadsheet of students that qualify to be included

– School’s low-income rate and placement rate (non-degree-granting school)

– School’s low-income rate and completion rate (degree-granting school)

Economically Disadvantaged Appeal (EDA)

34 CFR 668.184

Appeals of Official CDR

– Only available if a school is subject to a loss of eligibility or provisional certification based on official rates

– School must send completed Participation Rate Index Appeal to the Department within 30 days of timeframe begin date

• Participation Rate Index Appeal spreadsheet

• Letter

34 CFR 668.195

34 CFR 668.214

Participation Rate Index Appeal (PRI)

Appeals of Official CDR

– Subject to sanctions based on three consecutive CDRs

that meet or exceed the relevant threshold if

• At least two of their official cohort default rates are

average rates

• CDRs would have been less than the relevant threshold if they had been

calculated as non-average rates

– School must send completed Average Rates Appeal to the

Department within 30 days of timeframe begin date

• Supporting documentation

• Certification

34 CFR 668.195

34 CFR 668.214

Average Rates Appeal

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Appeals of Official CDR

– Department will automatically determine if school

meets criteria for thirty or fewer borrowers appeal

– If school disagrees with Department’s

determination • School must send completed Thirty or Fewer Borrowers

Appeal to the Department within 30 days of timeframe begin

date

– Supporting documentation

– Certification

34 CFR 668.197

34 CFR 668.216

Thirty or Fewer Borrowers Appeal

Common Appeal Errors to

Avoid

Avoid Two Common Errors

1) Check NSLDS for a student's

enrollment status

– Students who have withdrawn or dropped to

less than half-time status may be taking

classes that maintain their eligibility elsewhere

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Two Common Errors

2) If two entities are listed for a loan, make

sure you send any challenges to the

correct entity

– The one indicated with a usage code of “B”

rather than with an “E”

– Sending your challenge to the wrong servicer

or guarantor can cause you to miss your

deadline

Conclusion and Resources

Take Action

• Review the LRDR

• Compare defaulted borrowers to your

own system to ensure borrowers are

listed correctly

• Submit timely appeals, if necessary

• Analyze defaulted borrowers to see

if changes are needed in your default

management plan

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Resources

– ifap.ed.gov/DefaultManagement/Default

Management.html

– ecdrappeals.ed.gov

Default Prevention and Management

eCDR Appeals System

Thanks for Attending


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